Second Chinese Plant Completed in Shanghai to Step up Production in China

September 27, 2006


Horiba Instruments (Shanghai) Co., Ltd., our production subsidiary in China, announces the completion of its second Chinese plant, which has been under construction in Shanghai (Jiading District). With building and land areas 3.5 times larger than the existing factory, the new plant has space and layout that enable it to flexibly cope with HORIBA Group's business strategy in China. Equipped with a facility for designing products and training engineers locally, the plant is also intended to function as HORIBA's hub operation in China. On September 29, in the presence of distinguished guests, including the Alderman of the Jiading District, Shanghai City, and with the participation of President Horiba and other HORIBA board members, the new plant's opening ceremony will be held to celebrate the commencement of its full-scale operation.

Construction of the new facility started in February 2006 in the Jiading Industrial District northwest of Shanghai, the same location as HORIBA's first plant in China. The facility comprises two factory buildings and a two-story office building. Its building area comprises 3,510 square meters and its total floor space 5,370 square meters.

Production of consumables for automotive test systems and laboratory measuring systems, as well as sensors (electrode) for pH meters, will be transferred from the existing facility to the newly established plant. In addition, the new production facility will manufacture water quality-monitoring systems for the Chinese market and hematology analyzers for the Japanese market. In the future, the new plant is expected to commence production of the reagent for hematology analyzers geared to the Chinese market, as well as the manufacture of large-scale automotive test systems and ambient monitoring systems. Furnished with a "Seminar Room" and a "Training Room" designed to train engineers locally and provide technical guidance and seminars to Chinese users, the new plant will function as a "competence center" for technical and skill training as well.

Meanwhile, the existing plant underwent renovation this month to triple the size of its clean room, so that it can increase production of sensors for "mass flow controllers" (gas and liquid supply regulator for the semiconductor manufacturing system), a product of HORIBA STEC Co., Ltd. A repair center will also be established in the compound of the existing facility, to recycle major product parts such as the detectors of laboratory measuring systems.

With completion of the second Shanghai plant, HORIBA has established a system for well-integrated cooperation between its three major production sites in Asia, namely China, Japan (Kumamoto) and South Korea (Pucheon), and its head office factory (Kyoto), thereby ensuring more flexible and better-coordinated production.

With commencement of the new factory, Horiba Instruments (Shanghai) Co., Ltd. HORIBA's manufacturing subsidiary in China will share information and human resources with Horiba Trading (Shanghai) Co., Ltd., the company's Chinese sales subsidiary (which grew together with Horiba Instruments), thereby preparing HORIBA Group for further expansion of its business in China. Specifically, HORIBA aims at increasing its business in China by 3.3 times to 16.5 billion yen, or 11% of its entire sales, by 2010, which marks the final year of its middle- and long-term business plan.


References

Outline of the New Plant
Lot area: 7,380 m2
Building area: 3,510 m2
Total floor area: 5,370 m2
Number of employees: 62
First floor: Reception, Business Negotiation Room, Seminar Room, Training Room, Locker Room, Cafeteria, Quality Control Room, Large-scale Product Manufacturing Area, etc.
Second floor: Office Area, Conference Room, Reception Room, Board Room, Break Room, Server Room, Small-scale Product Manufacturing Area, etc.
[Remarks] Scale of existing plant
Lot area: 1,800 m2 / Building area: 1,150 m2 / Total floor area: 1,440 m2

Horiba Instruments (Shanghai) Co., Ltd.
Corporate Profile
Founded: August 20, 2002
Line of business: Manufacture of analyzers and main units; after-sales service in Chinese market
Responsible officers: CEO: Atsushi Horiba; President: Katsuhiko Higashino
Address: 1883-2 Huicheng South Road, Jiading Industrial District, Shanghai
Number of employees: 90
Sales: 218 million yen (actual sales for fiscal 2005)